$3m council grant but no affordable homes

A $3 million cash grant from the City of Sydney to convert an abandoned inner-city building into affordable housing wasn’t enough to get the 74 new unit-project off the ground.

Five years later, not a single affordable home has been delivered on the old motel site, which is on the market again to raise money for its owner, Wesley Mission.

The site at the end of Glebe Point Road – which had to shut down in 2010 after an elderly man was killed falling from an upper balcony –  is now likely to sell to developers wanting to build luxury apartments, student housing or aged care, reports the Sydney Morning Herald.

Despite endless federal and state government pushes to build more housing, financing of ‘affordable housing’ remains a delicate balance.  

The 2025 National Housing Supply and Affordability Council report found one in five approved homes in NSW didn’t progress to construction in 2024.

Despite big budget announcements around transport oriented development rules and a $6.6 billion Building Homes for NSW program to “deliver more than 21,000 affordable and market homes … using well located land that is sitting empty and unused”, there are still lots of structural and financial barriers for site owners.

When it comes to affordable homes, there’s plenty of new legislation to make it appear as though more affordable housing will be built, but not so much to ensure affordable housing is created. Even Housing Australia is making bold claims that more than 18,000 affordable homes have been contracted nationally.

Yet, while the big numbers sound promising, the reality behind delivery and access remains to be seen, especially for low-cost homes built in premium inner city locations. 

Back in 2020, the City of Sydney committed $3 million from its Affordable and Diverse Housing Fund to help Wesley Mission transform its abandoned RJ Williams Lodge in Glebe into affordable rental housing, but it came to nothing.

The grant was supposed to support a $16.5 million redevelopment but Wesley Mission never secured the remaining $8.6 million needed to build it.

Their bid for federal funds under the Housing Australia Future Fund failed. By late 2024, Wesley Mission returned the council’s grant.

Can other affordable housing sites fill the gap?

There is hope that former WestConnex sites in the inner west can be unlocked for more affordable housing, with this Camperdown development in the works and more in nearby Five Dock, where this development of 1185 new apartments will have 218 set aside for ‘affordable housing’.

Maybe these new projects will have more luck getting their finances sorted …